December 22, 2008

The Morning Wrap

BACKING OUT: Altanta-based King & Spalding, reportedly in talks for weeks to acquire a significant portion of Thacher Proffitt & Wood, is no longer pursuing the acquisition, a lawyer familiar with the negotiations tells The American Lawyer. For King & Spalding, the bank debt and lease exposure of an outright acquisition was too much. Sonnenschein Nath & Rosenthal has reportedly entered into talks with Thacher lawyers, The American Lawyer reports. Lacking a merger partner, Thacher faces the possibility of dissolution.

COMMINGLING CONCERN: A bankruptcy judge in New York has appointed a trustee for the Dreier LLP Chapter 11 proceedings amid concern about "a huge amount of commingling" of assets between the firm and its founder and sole equity partner Marc Dreier, who is jailed on allegations he orchestrated a $380 million scam, The New York Law Journal reports. Dreier was arrested Dec. 7 on charges of securities and wire fraud. The bankruptcy receiver, Mark Pomerantz, a partner at Paul, Weiss, Rifkind, Wharton & Garrison, raised the commingling concern.

SOMEONE'S LISTENING:The Washington Post today explores the wiretap history that led to the arrest of Illinois Gov. Rod Blagojevich, who vowed last week in a Friday press conference that he plans to fight on and clear his name. The investigative tactics included the use of threats of prosecution or prison time to convince small-time players to talk in what the Post calls "a tangle of elaborate schemes." ABC News Chief Washington Correspondent George Stephanopoulos said Sunday that Obama's review of his staff interaction with Blagojevich shows Chief of Staff Rahm Emanuel had a single call with the governor. Stephanopoulos describes the call as a "courtesy," saying that Emanuel and Blagojevich reportedly talked about Emanuel's Congressional seat. Obama's report is expected to be released this week.

FILLING THE CABINET WITH SPEED: President-elect Barack Obama didn't waste any time filling government's top slots, nearly completing the naming of his cabinet members as he sets transition records for speed, according to the The Wall Street Journal. But the push to get positions filled has frustrated some liberal groups that believe their interests are not adequately represented.